Centaurus Metals Re-Shapes Jaguar Feasibility Study to Focus on Nickel Concentrate Project
THE DRILL SERGEANT: Centaurus Metals (ASX: CTM) has re-jigged the ongoing Feasibility Study work being undertaken on the company’s 100 per cent-owned Jaguar nickel project in northern Brazil.
Centaurus Metals has been keeping a close watch on changes in nickel market conditions over the past few months, which has stemmed mainly from increasing supply from Indonesia resulting in the LME nickel price plummeting by over 36 per cent over the past year, from around US$25,000/t to recent lows below US$16,000/t.
Centaurus has taken the decision to reshape the current Feasibility Study – deferring the parts of the study relating to a fully integrated downstream nickel sulphate project to focus instead on completing the study based on an initial nickel concentrate-only project.
The company may consider development of a potential downstream refinery when market conditions improve.
Recent discussions the company has held with potential customers and strategic partners have indicated strong interest for Jaguar’s low-carbon, non-Indonesian supply of nickel sulphide concentrate product.
“The changes we have seen in the nickel space in recent months cannot be underestimated,” he said,” Centaurus Metals managing director Darren Gordon said in the company’s ASX announcement.
“While we think nickel prices have overshot on the downside and could rebound much quicker than some market forecasts suggest with supply growth now slowing significantly, we also want to be prudent and preserve maximum value and optionality for our shareholders while delivering an attractive, lower capital cost development route at Jaguar which demonstrates the quality of the project throughout the commodity price cycle.
“A lower CAPEX concentrate project, with lower technical risk and a lower cost of capital in the current market, delivers a better outcome for our shareholders.
“When we see the exceptional work being done by Ero Copper on its four million tonnes per annum copper concentrator at Tucumã, just 40km from Jaguar, we have a lot of confidence in what we should be able to deliver from a similar-sized concentrator at Jaguar.
“We remain convinced that Jaguar, which hosts Resources of nearly one million tonnes of contained nickel, is one of the top-3 nickel sulphide development projects globally, which we anticipate will become an increasingly important source of low carbon nickel supply, particularly for the Western EV battery industry.”
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